Department Highlights

The Center for Data Analysis (CDA) specializes generally in three core areas of research and simulation modeling: federal energy, environment, and climate economics; federal fiscal policy; and federal social policy. The CDA produces a large volume of independent policy research in each of these areas that is relied on by policymakers. CDA analysts are frequently asked to testify before Congress on their research and to score proposed legislation for Members of Congress and committees. A summary of the CDA’s three core areas of focus follows.

Energy, Environment, and Climate Change Policy

CDA modeling of energy and climate economics is unique among think tanks in Washington. The Heritage Energy Model employs computer code that is virtually identical to that of the Energy Information Administration (EIA) National Energy Modeling System (NEMS). This allows us to replicate and confirm EIA studies and to extract granular output data that are not readily available from the EIA. In addition, we can estimate (and have estimated) the impacts of policies and policy variations in a way that the EIA either has not done or has not made public. Our estimates of the impacts of phasing out coal power (the “war on coal”) and carbon taxes have been widely cited.

The CDA also has installed two of the three integrated assessment models (IAMs) employed by the Interagency Working Group on the Social Cost of Carbon (IWG). (The proprietor of the third IAM refuses to allow independent analysis of his model.) The social cost of carbon is a key factor in the benefit/cost analysis of energy and climate policies. Our analysis of the two available models uncovered several key items. Among them: The IWG incorrectly specified a set of variables used in the calculations of one of the models, and the calculated estimates of the social cost of carbon are profoundly susceptible to reasonable changes in assumptions. This simulation and modeling is led by Kevin Dayaratna, Ph.D., and David Kreutzer, Ph.D.

Fiscal Policy

The CDA analyzes the impact of federal spending and debt on the broader economy. Our conclusions are built on statistical analysis of aggregate data and the work of academic economists. Recent publications in this area include a review of the impact of debt on growth,, a Special Report on European austerity,, and an accompanying data compendium for use by other researchers. Additionally, the CDA has long been a champion of using dynamic analysis to “score” the impact of major policy changes on the federal budget. Our dynamic scoring work draws upon an integrated set of econometric models developed by the CDA and leading economic consulting companies and maintained by the CDA. This research is led by Salim Furth, Ph.D., Rachel Greszler, and John Ligon.

Social Policy

Our work in social policy first includes original research and analysis by CDA economists, using the Heritage Health Insurance Microsimulation model, studying the effects of federal health policy on U.S. health insurance markets. The CDA frequently uses this microsimulation model to score elements of federal health insurance and health care reform. Additionally, we will soon use a proprietary recursive model developed by the Anderson Economic Group to estimate the economic effects that uncertainty under the Affordable Care Act is having on U.S. firms.

This work is led by Drew Gonshorowski.

Second, our work in social policy includes research on federal labor policy. The CDA uses microdata to analyze changing labor market trends, such as why labor force participation fell during the Great Recession, how workweeks changed during that period, and whether federal employees enjoy premium wages This research has helped to shape the policy debate on Capitol Hill. Congress frequently calls upon CDA’s labor market researchers to testify about the economic effects of proposed legislation. This research is led principally by James Sherk.

Third, our work in social policy includes research and analysis on the effectiveness of federal social programs. The CDA assesses the impact of social programs by conducting original evaluations and performing reviews of the scientific literature. This research has culminated in, for example, panel data analyses of Department of Justice and Department of Homeland Security grant programs and Dr. David B. Muhlhausen’s book, Do Federal Social Programs Work? The influence of CDA’s evaluation research is represented by the numerous times CDA expert testimony has been sought by congressional committees, including the House and Senate Committees on the Judiciary, Senate Committee on the Budget, and House Committee on Ways and Means. This research is led by David B. Muhlhausen, Ph.D.

ABOUT The HERITAGE FOUNDATION

The Heritage Foundation is the nation’s most broadly supported public policy research institute, with hundreds of thousands of individual, foundation and corporate donors. Heritage, founded in February 1973, has a staff of 275 and an annual expense budget of $82.4 million.

Our mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense. Read More